Mortgage approvals at 2007 levels

Banks, which currently account for most new mortgages, approved 42,100 home loans for house buyers in September, up from 40,100 in August. Bank mortgage approvals are now 77% higher than a year ago according to the figures.

Commenting, BBA statistics director, David Dooks, said: "Mortgage lending by the high street banks is continuing to improve from the lows seen earlier this year and the number of house purchase approvals continues to recover. Housing market activity will depend, however, on more properties coming on to the market. Apart from property decisions, further symptoms of subdued consumer confidence are a reduced appetite for unsecured borrowing and more saving.

"Lending to companies continues to be affected by current trading conditions. In perhaps the hardest-hit sectors, related to commercial property and construction, lending levels continue to fall and company borrowing in general remains subdued."